Commercial digital transactions around the world should not promote many face-to-face relationships. But they can encourage attempts to fraud as fraudsters impersonate legal businesses and wreaking havoc among global companies' invoices and accounts receivables.
Trebipai, Company to pay from business Based in Overland Park, Kansas, companies (usually selling over $100 million) provide new customers with software solutions to new customers, preparing and submitting invoices. The company is also fighting fraud for its customers, Trevipay CEO Brandon Spear said in an interview.
Trevipay usually focuses on expanding trade credits to buyers in the form of extended payment terms that Trevipay sellers' customers may not want to fund themselves. Trevipay operates in 32 countries and industries including manufacturing, retail, accommodation and transportation.
Spear spoke on June 16th on a payment dive. This conversation was edited clearly and concisely.
Payment Diving: Please tell me the details Trevipay's work.
Brandon Spear
Permission granted by Trevipay
Brandon Spear: All of us are to help sellers provide trade credits or payment terms to business customers. And the reason for this complex effort is firstly because when providing trade credits there are many business processes that are not necessarily properly housed within ERP (Enterprise Resource Planning) software or accounting software. So much of this is done manually today and outside of these types of systems. Secondly, we have seen the rise of things like AI, so we have seen more demand for global commercial transactions, and so there has been a significant increase in attempts at fraud. There is more risk these days, as you get customers online and don't necessarily know who you are, and your business is trying to see who they are.
What is the typical trade credits a company offers to its customers?
Trade credit is actually one of the loyalty tools that sellers have on their buyer base. You buy something from me and I give you 30 days to pay, or 60 days to pay, or 45 days to pay. Basically, I buy it with credit card. The reason this is interesting is that it is one of the most powerful tools for sellers to make customers spend more money. Obviously, you need to have a good product and good service and do all these basic things. But, at the end of the day, one way to compete with your competition is to provide trade credit terms to the buyer base. And if that's the case, hopefully they'll spend more money with you. So, it's like the original loyalty program, if any, for business.
Given the infinite number of lenders and other lenders who can expand your credit, what is the value proposition for your platform?
This whole business process is called the order to cash business process. And when you see where players like banks play today, they only play in that very narrow section. So you want to get paid early? They will fund if you are a merchant and want to provide 30 days terms, but you have no working capital, you can go to the bank and they can basically move your money forward against your bill, but you still need to do all the hard work onboard new customers, build the correct bill, deliver it to them, handle the dispute. You still have to do all that work yourself. A large part of our value proposition is simplifying their business and allowing them to focus on what they do and remove costs. Another big part of your value proposition is increasing your wallet share with customers. What we found was that when you combine these with buyers, it's easier to do business than your competitors when you present your bill the way you want to receive it, so ultimately you spend more money.
What will give you a headache in your business or keep you waking up at night?
Perhaps what scares us the most… is that there is a considerable amount of business identity theft. No one really wrote about it. And what has been hindering bad actors for so long is how they expand their activities. And I think AI will become transformative because of fraud. Allow the refinement of fraud scams to leap the number of fraud scams and the abilities that many people have. And there will be an AI arm race on the fraud front. And we look at it really carefully. And I think the dilemma here is basically risking freezing new client acquisition through e-commerce channels, unless you understand a good answer to this. When you physically meet someone and you do business with them directly, it's really hard for a scammer to expand it. They can't do that. But you can set up a bot that can pretend to be someone and answer emails and fill out the form. If this is not done correctly, e-commerce channels for new client acquisitions will be frozen as there will be so many frauds. So we look at it really well. It's definitely one of the things that keeps us up at night.
What about AI's ability to fight fraud? Isn't it a symmetrical AI arm race?
Hopefully that will happen. Please give an example. Today's scammers create fake websites with one or two layers depth. And when I run a scan on it, I see that the first layer looks reasonable, but below that it's pretty junk. You can use AI bots to deepen 10 or 15 layers, which may seem reasonable. So I think there's a weapons race. Hopefully it's symmetrical. But it's for merchants that it becomes asymmetric. When you think about the average merchant, you deal with someone who is, say, $500 million in business per year. How much are you thinking about this? How much do you think about the potential scams and scam escalations from AI for business customers who may move forward in the future through ecommerce channels? There is not much of a shared mentality that is still in it, so I think it's likely that asymmetry will be created.
How did the turmoil of the Trump Trade War have had on your business?
We've seen that a lot of unusual behavior is probably the best way to say it. There, people have been raising some parts before the price rises. And we've seen the seasonality I describe as atypical. For us, the actual end of summer is a big seasonal month. In the (trucking) space, people take a lot of fleets and keep them in the summer in anticipation of the Thanksgiving and Christmas stages. They are very busy so they don't want their trucks to be served for those months. We've seen some of the things that probably happen in August and some strange seasonality. I think it actually happened in May because they moved these things forward.
